Bitcoin’s price is currently positioned between a critical psychological turning point and a zone of optimism, based on historical data. This region represents a pivotal moment where market participants develop either optimistic or pessimistic views depending on whether they are in profit. As long as Bitcoin remains in this range, it suggests that a significant decline is unlikely.

The Importance of Staying in the Optimistic Zone

Historical data shows that maintaining stability in these critical zones is crucial for the continuation of bull markets. Specifically, the "Supply in Profit" metric, which reflects the period when investors are in profit, indicates that optimism tends to rise when a significant portion of the supply is in profit. Bitcoin’s current price levels are now testing this zone of optimism.

Review of Previous Periods

In past market cycles, such as the bull markets of 2016 and 2020, Bitcoin remained between the psychological turning point and the optimism zone, resulting in continued price increases. When these lines were sustained, the market entered a strong upward trend, suggesting that if optimism is maintained under current conditions, a similar move could occur.

Weakening Expectations of a Major Decline

Considering current price movements and the supply metric, as long as Bitcoin remains within this range, the likelihood of a significant price decline appears low. A drop below this range could shift market sentiment towards pessimism, leading to lower prices. However, until such a breakdown occurs, the market is likely to remain optimistic.

Conclusion

Bitcoin’s price is sitting at a psychologically important level. Historically, when prices stayed within this range, the market continued its upward trend. To maintain the bull run, it is crucial to remain in this zone of optimism. If this region is preserved, it will bolster investors' confidence in future price increases.

Written by datascope